The total estimated cost to the public sector was £2.2 million, however, by the time the Centre closed the cost to the taxpayer had risen to £3.4 million

Serious weaknesses were found in the funding process of a rural tourist attraction, a damning report by the Auditor General reveals.

The Cywain Centre at Bala
opened in April 2008 but soon ran into difficulties and finally closed in September 2011. The total estimated cost to the public sector was £2.2 million. However, by the time the Centre closed the cost to the taxpayer had risen to £3.4 million.

In his critical report, published on Thursday, Auditor General for Wales Huw Vaughan Thomas said: “The project was always likely to fail because of flawed income assumptions and a lack of clarity over what the Centre was meant to offer, both of which were not adequately challenged by funders.

“Funders did not identify and address all of the key risks and placed too much emphasis on the potential benefits of the project.”

Mr Thomas added the business case for the Centre was underpinned by unsupported and unrealistic assumptions.

But despite this they approved grant funding, without putting effective measures in place to mitigate and manage the risks to the project that they had identified he said.

The project was developed by Antur Penllyn, a community regeneration company set up in 1989 to regenerate the Bala area.

The Centre, located outside the town, was intended to hold events and exhibitions on agricultural methods, provide training and education in rural skills, and exhibit modern artworks.

Once the Centre became operational, funders did not monitor its operations adequately and were slow to respond to the threat and actual closure of the Centre in order to protect the public’s interest in the assets.

Darren Millar AM, chair of the National Assembly’s Public Accounts Committee, said: “The findings of the Auditor General’s report are extremely disappointing but should come as no surprise given the historic problems in the Welsh Government’s management of grants which have been a matter of concern for the Public Accounts Committee in recent years.

“The Committee will be considering this report, alongside other work on the Welsh Government’s management of grants, soon after the Easter recess.

"It’s crucial that grants deliver better value for money for taxpayers and that will be our chief aim.”

The report into Cywain follows a number of other examinations by the Auditor General in recent years into grants funded schemes.

Mr Thomas added: “The Cywain Centre highlights some serious weaknesses in grants management by public sector bodies that existed at the time.

“Subsequently, there have been some improvements in the way grants funding is managed.

“My recommendations are intended to further strengthen these arrangements and ensure Welsh Government grants deliver better value for money.”

A Welsh Government spokesman said: “Safeguarding public money is something we take extremely seriously. We have already made improvements to the way we monitor projects, based on lessons learned from previous WAO reports.

“We will now consider the recommendations of the WAO’s report and will respond to the findings in due course.”

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Mark Thoma

Liverpool-born Mark joined the Daily Post in January 2014 after seven years as editor of its Merseyside sister title the Liverpool Post. He started out as a weekly news reporter on Wirral Newspapers, and spent seven years at the Daily Post and Liverpool Echo. He was The Press Association's regional correspondent for North Wales, Merseyside and Cheshire from 1983 to 1997, before returning to the ECHO as deputy news editor. He has won a number of journalism awards, including the UK Press Gazzette Regional Reporter of the Year award, and in 1993 wrote a book on the James Bulger murder.